Reebok sues SOCOG over sponsorship deal

United States sportswear company Reebok International says it has dropped a multimillion dollar sponsorship deal with Sydney Olympic organizers SOCOG and has launched legal action seeking damages for an alleged breach of contract.

United States sportswear company Reebok International says it has dropped a multimillion dollar sponsorship deal with Sydney Olympic organizers SOCOG and has launched legal action seeking damages for an alleged breach of contract.

Reebok Australia's general manager Keith Forbes said the company had terminated a deal which reports estimated at 15 million Australian dollars (9.45 million US dollars) because SOCOG had struck deals with competitors Bonds and Canterbury.

"We actually filed a summons today in the Supreme Court for the breach of contract," said Forbes on Wednesday.

"We had an exclusive arrangement with SOCOG as a sports brand and they've breached that by entering into agreements with some of our competitors."

Reebok was to be the official sports brand of the Sydney Olympics and the exclusive supplier of sports brand product to SOCOG, the Australian Olympic Committee and the Sydney Paralympic Organizing Committee.

Forbes said the company had been talking about the issue "over a period of months" with SOCOG.

"We got to some serious mediation last week but they've been pretty inflexible in their resolve," said Forbes.

Forbes said the company was still hoping to outfit the Australian athletes.

"We've made an offer to continue with the Australian team but it's in the hands of SOCOG to decide," he said.

SOCOG chief executive Sandy Hollway said Reebok still owed the organizers millions of dollars in cash and value in kind and should not be able to "cherry pick" parts of the deal such as outfitting the athletes.

"We're very disappointed that Reebok has announced it intends to terminate the sponsorship," said Hollway in a statement. "We will vigorously defend SOCOG's position in this matter.

"There has been absolutely no breach - Reebok are a supplier under sponsorship of sporting apparel.

"They confuse sponsorship and marketing rights on the one hand with supply and merchandising rights on the other ... we believe this is an utter misconception of what the contract involves."